Monday, February 10, 2014 7:06:49 AM
The blend of these two fashion forward premium jean companies seems compelling. With the ability to cut production and marketing costs the future seems bright. Hamish Sandhu, Chief Finanical Officer, was quoted as saying,
"Going to an overview of two main denim brands, how they're different, how they are similar. So we have $200 million in revenue, as you can see the Hudson brand has grown from $65 million all the way up to $80 million over the last three years; the Joe's brand has grown from $95 million to $122 million over the last three years. So these brands are growing, we expect them to continue to grow."
As you can see, the Joe's and Hudson brands are relatively healthy and arguably pretty strong. Positive news could result in a nice surge in shares for investors. In the last six months, Joe's has traded between $1.05 and $1.30. On February 17, Joe's Jeans closed at $1.23. This current price per share gives Joe's a market cap of only $83 million. Given the fact that they are currently bringing in $200 million in revenue, itseems like a great entry point and makes shares relatively inexpensive. Shares become even more of a bargain if you believe in Joe's Jeans' future and ability to continue the dramatic growth as well as bring in profits.
There is no denying that Joe's Jeans has had a volatile history with its earnings reports. Needless to say, this is a critical report from Joe's Jeans. Investors should be prepared for a double digit % swing in stock price in either direction. After taking a quarter off because of the cost related to the Hudson acquisition, it will be interesting to see if Joe's Jeans can get back to its streak of posting a profit. Both Joe's and Hudson have been growing sales for years and the analysts seem to have low expectations. Hudson certainly has the ability to really surprise investors on this report and it just may be worth the gamble to see if shares of Joe's Jeans fit in your portfolio.
READ MORE on SA:
http://seekingalpha.com/article/2006931-take-a-look-at-joes-jeans-before-earnings?source=nasdaq
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